Lots of Problems

Doug Wheat has a problem with his next-door neighbor. When he and his wife moved into a subdivision just east of the Galleria 11 years ago, they were seeking peace and quiet. They liked the fact that deed restrictions prohibited commercial use of the vacant lots across the street from their house.

All of a sudden, he says, their neighbor loudly and obnoxiously violated that very restriction. And if it were any other neighbor, Wheat might knock politely on the front door and ask them to please cut it out. But when your neighbor is Twelve Oaks Medical Center, and when it's a $14 million hospital expansion, and when it's owned by a conglomerate out of North Carolina, you've got a fight on your hands.

About a month ago, the hospital's contractors set up a construction staging area on the lots, complete with truck-mounted cranes, storage units, forklifts and an office trailer. Wheat and his wife might not have minded so much, except their two young children live within blink-and-they're-gone distance from trucks hauling debris out of the neighborhood.

When Wheat and the Weslayan Plaza II Homeowners Association accused the hospital of violating deed restrictions, the hospital didn't seem to care.

The city of Houston's legal department does, however. It gave Twelve Oaks until last Saturday to halt construction activity or else face a lawsuit and $1,000 a day in fines.

Homeowners association president Karl Muench said that as of the following Monday, contractors had completely cleared the site.

The group is still bracing for a potential legal battle, however.

"They basically just thrust this upon us without discussing it with us," Wheat says of Twelve Oaks. A maritime attorney, Wheat is the head of one of about 50 households who have signed a petition against the hospital in the 60-home subdivision.

But officials at Twelve Oaks, which has owned the lots for years, say they're not breaking the law. And, from what Wheat and others believe, the hospital doesn't really care if they are anyway.

Until Twelve Oaks had someone post notices on doors throughout the subdivision last month, it was a quiet neighbor, says Muench.

But last year, Tenet Healthcare Corporation sold Twelve Oaks to Hospital Partners of America, which planned to add six operating rooms and create a consolidated ambulatory-surgery center on the hospital's first floor. Yet the only financially feasible way to do this would be to use the hospital's east side lots during construction -- right in the heart of the subdivision -- according to Twelve Oaks spokesperson Ed Muraski.

Twelve Oaks "basically said they were going to money-whip us," says Muench, the most vocal critic. Although Twelve Oaks offered to spend $100,000 on landscaping a park on the lots after the 14- to 16-month construction process, the homeowners weren't happy. Hospital officials also offered to sell the land to single-family-home developers or build houses themselves. But the homeowners didn't want them violating the deed restriction, no matter what they said they would do down the road.

Muench says the people who signed his petition think a hospital expansion would be a wonderful addition to the city. But they don't think the hospital should be allowed to break the rules just because it's too expensive to get the work done from another side of the building.

Although a majority of the subdivision backs Muench, Muraski originally characterized him as a lone marauder bent on derailing civil discussion on the issue.

"We are a property owner as well, and I feel sometimes based on the events of the last couple days, and some of the tactics employed by Mr. Muench, that these are threatening tactics that are intended to force us to use our property the way he wants it to be used," Muraski said.

But Muench also has the backing of city attorneys.

Dan Doherty, who heads the city legal department's revenues and compliance division, says an investigation of the construction activities showed a violation of the deed restriction. His office issued letters to Twelve Oaks and Hospital Partners of America representatives on August 13, demanding them to cease within 15 days. "They can disregard the letter, but they can't disregard the lawsuit," he says.

Caught within all this is Houston City Councilmember Mark Goldberg, who was a Twelve Oaks board member under Tenet ownership.

"I want to avoid a protracted litigation, and I also want to protect the covenants of the deed restriction," he says. "And there is room for a compromise without doing either of those two things."

Or at least there used to be.

Muraski recently refused to say if Twelve Oaks would heed the city's warning.

"We have a legal team that is reviewing all of our options at this point," he says. Muraski blames the position of the city attorneys on "one-sided arguments" raised by some members of the homeowners association.

But when asked again by phone if Twelve Oaks would respect or ignore what's come out of the legal department, Muraski said, "Things are moving, and that's really all I can say at this point." Then he hung up.

Calls to HPA's chairman and CEO went unanswered. Fred Fink, HPA's president and chief operating officer, would not say if his company would continue construction. He said he would have someone more familiar with the issue call back for an explanation. No one did.

In a recent meeting Muench attended with homeowners and Twelve Oaks, the hospital's chief operating officer said Twelve Oaks was considering hiring either the legal giants of Vinson & Elkins or Baker Botts.

"They said that we don't have enough money to fight them and hire lawyers, so they're going to do whatever they want, basically," Wheat says. "We don't have to actually hire lawyers; I have people that work for me that'll do this."